Struggling Crypto Exchange FTX Files For Bankruptcy

FTX Founder SBF Unaware of Illicit Use of Customer Funds?
  • The exchange went from a $32 billion value to insolvency in a matter of days.
  • FTT has dropped by over 27% in the previous hour following the announcement.

FTX has formally declared bankruptcy. Liquidity dried up, user funds were frozen, and competitor exchange Binance pulled up its non-binding deal to purchase FTX, sending the firm from a $32 billion value to insolvency in a matter of days.

The processes are entirely optional for Alameda Research and the other 130+ affiliated companies. However, LedgerX (which operates as FTX US Derivatives), FTX Express Pay, FTX Digital Markets, and FTX Australia are not included in the release.

Revival Efforts Failed

Although FTX withdrawals were suspended, FTX U.S. withdrawals continued normally. For the sake of regulators, FTX has resumed withdrawals in the Bahamas and indicated that a few other countries have begun partial withdrawals throughout the course of the preceding hours.

Earlier, FTX tweeted that it has reached a deal with Justin Sun’s TRON network, allowing holders of TRX and a few other currencies to trade their assets from FTX to other third-party wallets. 

With the bankruptcy announcement, the price of bitcoin dropped by a thousand dollars, lowering it to $16,500 in a matter of minutes, and is now trading at $16,983. Because of this revelation, the native token of the FTX exchange, FTT, has dropped by over 27% in the previous hour and by 95% in the past 7 days. At the time of writing, it was trading at $2.7.

Sam Bankman-Fried was trying to save his failing cryptocurrency exchange, FTX, with a $9.4 billion rescue plan. But it seems nothing worked out in the end.

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An engineering graduate who is passionate about writing and loves the very existence of crypto. Trading forex currency keeps me busy when I am not writing and analysing the crypto world.